A.On October 14, 2016, L. 2016, c. 56 was enacted, amending the TTFA Act and authorizing the issuance of up to $12 billion in Transportation Program Bonds between FY 2017 and FY 2024. An accompanying piece of legislation, P.L. 2016, Chapter 57, increased the Petroleum Products Gross Receipts Tax ("PPGRT"). Beginning on November 1, 2016, the PPGRT increased: (i) on highway fuel and aviation fuel from 2.75% to 12.85% of gross receipts; (ii) on petroleum products other than highway fuel and aviation fuel from 2.75% to 7% of gross receipts; and (iii) on July 1, 2017, on diesel fuel from 4 cents per gallon to 8 cents per gallon. In accordance with Chapter 57, the PPGRT on highway fuel and on petroleum products other than highway fuel and aviation fuel are converted to a cents-per-gallon.

For petroleum products, gross receipt taxes on highway fuel converted to a rate of 22.6 cents per gallon. The existing Motor Fuel Tax ("MFT") is 10.5 cents-per-gallon and the existing PPGRT imposed on gasoline, blended fuel that contains gasoline, liquefied petroleum gas and aviation fuel is 4 cents-per-gallon. As of November 1, 2016, the tax paid by the motorists at the pump was 37.1 cents per gallon. On October 1,2018 the tax paid by motorists increased by 4.3 cents to 41.4 cents per gallon, in accordance with provisions of the 2016 legislation authorizing adustments to the PPGRT rate, contingent upon revenues meeting the state's Highway Fuel Cap revenue targets for the fiscal years.

The Covid-19 emergency caused the consumption of gasoline and diesel fuel to decline 38% and 16%, respectively, from March to May of 2020. As such, and in accordance with the provisions of the 2016 legislation, the tax paid by motorists was increased by 9.3 cents to 50.7 cents per gallon on October 1, 2020 to help meet the State's Highway Fuel Cap revenue target for the fiscal year. Conversely, Fiscal Year 2021 MFT and PPGRT revenues exceeded anticipated levels, which in turn resulted in an 8.3 cent decrease in the tax paid by motorists at the pump to 42.4 cents per gallon, effective October 1, 2021. The PPGRT was decreased by an addition 1.0 cent per gallon to 41.4 cents per gallon effective October 1, 2022 as Fiscal Year 2022 fuel consumption revenues moderately exceeded fiscal year revenue targets. With MFT and PPGRT revenue for Fiscal Year 2023 falling slightly under target, the State increased the PPGRT by 0.9 cents per gallon effective October 2023.

All of the revenue derived from motor fuels taxes is constitutionally dedicated to transportation purposes in accordance with the voter-approved amendment of Article VIII, Section II, paragraph 4 of the New Jersey State Constitution, which appeared on the November, 2016 ballot. In addition, the constitution continues to provide an annual dedication of no less than $200 million from the Sales and Use Tax.

Beyond the constitutional dedications, the Authority also receives annual revenue from contributions authorized by contracts entered into with the State’s toll road authorities. Statutory dedications from certain motor vehicle violations and heavy truck registrations are also authorized, however those amounts are subject to appropriation and have not been provided by the Legislature in recent years.

The 2016 reauthorization legislation also authorized bonding of $12 billion in FY 2017- FY 2024, the debt service for which will be paid solely from constitutionally-dedicated revenues. These funding sources, as well as future pay-as-you-go appropriations from the revenue dedications, will satisfy the Authority’s fiscal needs during the eight year reauthorization period. 

The FY 2024 Appropriations Act recommends an appropriation to the TTFA of $1,567.5 million. The FY 2023 Appropriation Act recommended an appropriation of $1,552.9 million. As outlined below, this amount represents an increase of $14.6 million (0.01%) from the amount appropriated in the FY 2023 Appropriations Act, and is sufficient to pay for the Authority’s FY 2024 projected debt service costs.

The FY 2024 and 2023 appropriations are detailed below:

* Amounts shown are per Appropriations Act and does not reflect any lapses.

Beginning in FY 2017, annual revenues from the increased tax dedication were expected to significantly exceed the appropriations noted above. Those amounts are subject to appropriation by the Legislature. Appropriations that exceed the annual amount required for TTFA debt service payments may be used to pay expenses on a “pay-as-you-go” basis. Alternatively, if the Authority’s appropriations and other revenues exceed the amount required to meet its statutory purposes in a given FY, those additional amounts may be deposited into the newly authorized Transportation Trust Fund Sub-Account for Capital Reserves as a means of ensuring the adequacy of funding for future needs.

Q. Has the TTFA recently issued any debt other than traditional state contract debt?

A. On October 26, 2016, TTFA issued $2.7 billion in 2016 Series A Federal Highway Reimbursement Revenue Notes (Indirect GARVEEs) which were publicly offered and $.5 billion in 2016 Series B Indirect GARVEEs, which the Series B notes evidenced a term loan made to the Authority. These resources were sufficient to pay project expenses during FY 2017, FY 2018, and part of FY 2019. In July 2018 the Authority refunded $1.3 billion in 2016 Series A Indirect Garvee notes, generating approximately $124 million in NPV savings to the Authority. (see Garvee Bonds section for more information)

A. The Transportation Trust Fund is the term commonly used to refer to the State’s Transportation Capital Program. The annual Capital Program is described in the project list that is submitted to the Legislature each year by the Commissioner of Transportation on March 1 and is approved in the Appropriation Act by June 30 of each year. The project list is the spending or contract authority that allows the New Jersey Department of Transportation (NJDOT) and New Jersey Transit Corporation to advance capital projects up to a specified limit. The Transportation Trust Fund Authority (TTFA) is an independent agency that actually finances the cash disbursements to contractors as they occur for Transportation Trust Fund projects. The TTFA uses appropriated revenues and bond proceeds to finance the disbursements. The TTFA is a financing agency only with no involvement in the selection of capital projects.

Q: What is the Special Transportation Fund and why is it important?

A. The Special Transportation Fund is a separate fund maintained by the State Treasurer to which the Authority transfers available funds for deposit.  Monies deposited in the Special Transportation Fund may be used to fund payments to be made by or on behalf of the NJDOT for capital projects included in the annual Transportation Capital Program.

A. On November 1, 2016, the tax paid by the motorists at the pump increased to 37.1 cents per gallon. The cents-per-gallon tax on diesel rose to its full rate of 44.2 cents as of July 1, 2017. On October 1, 2018 the tax paid by motorists for both gasoline and diesel increased by 4.3 cents per gallon as a result of a provision in the 2016 TTF Legislation allowing for adjustments in the Petroleum Products Gross Receipts Tax (PPGRT) rate, contingent upon the State of New Jersey meeting annual Highway Fuel Cap Amount revenue targets.

the impact of Covid-19 resulted in a steep decline of gasoline and diesel fuel consumption from March to May of 2020. As such, and in accordance with the provisions of the 2016 legislation, the PPGRT paid by motorists for both gasoline and diesel increased by an additional 9.3 cents per gallon on October 1, 2020 to help meet the State's Highway Fuel Cap revenue target for the fiscal year.

Conversely, the PPGRT decreased by 8.3 cents per gallon, effective October 1, 2021, and by another 1.0 cent per gallon effective October 1, 2022 as State revenue collections exceeded fiscal year tax revenue targets, in accordance with provisions of the 2016 legislation in meeting the target. Currently, the per gallon tax paid at the pump on gasoline and diesel fuel is 42.3 cents and 49.3 cents, respectively, after an increase of .09 cents per gallon effective October 2023

Q. How does the annual spending authority provided by the newly reauthorized TTF program compare to past years?

A. Unlike the TTF legislation enacted in 2012, P.L. 2016, Chapter 56 does not prescribe the exact size of the TTF spending authorization for any given FY.  Instead, annual program spending plans of various sizes may be recommended so long as the total amount does not exceed $16 billion over the eight year period.  Ultimately, the Legislature must determine the precise spending authorization for any given FY. The FY 2022 Appropriation Act authorizes a $2.0 billion capital program. The FY 2021 Adjusted Appropriation Act authorized a $2.6 billion capital program, which included an additional $600 million for the advancement of Department of Transportation projects. The FY 2020 and FY 2019 Appropriation Acts authorized $2.0 billion in TTF annual capital programs while the FY 2018 Appropriations Act authorized a $2.050 billion capital program, including a $50 million supplemental appropriation to NJ Transit. The FY 2017 Appropriations Act authorized a TTF program totaling $1.6 billion, which matched the amounts authorized in annual Transportation Capital Plans from FY 2012 through FY 2016, including funds provided by the Port Authority of New York and New Jersey for the Lincoln Tunnel Access Program (LTAP, e.g. Pulaski Skyway). A supplemental appropriation increased the FY 2017 program to $2.0 billion.

A. None. The Transportation Trust Fund Capital Program is a spending authorization for NJDOT/NJ TRANSIT capital projects. There is no line item for Authority debt service in the NJDOT/NJ TRANSIT capital program. Debt service is a function of the Transportation Trust Fund Authority which is separate and distinct from the NJDOT/NJ TRANSIT capital program. Debt service payments are funded through the State's annual capital appropriation to the Authority, not through the TTF Capital Program's spending authorization.

A.Transportation System Bonds (referred to as “Prior Bonds” in L. 2012, c. 13) refers to bonds issued pursuant to authorizations previously provided in P.L. 1995, c. 108 and P.L. 2006, c.3, as well as any bonds issued to refund those “prior” bonds. Transportation Program Bonds refers to bonds issued pursuant to the authorization enacted in June 2012 (P.L. 2012, c. 13) and any bonds subsequently issued to refund those particular bonds.

A. The TTF's "pay-as-you-go" component is equal to the appropriation revenue received by the Authority in a given year adjusted for any lapses, investment income, and Build America Bonds tax credits less the debt service payment for that same year. The difference represents the current year revenue that is available to pay capital project costs. Bond proceeds are added to "pay-as-you-go" revenue to cover total capital project costs for the year.

The 2016 TTF Re-authorization provided a new "pay-as-you-go" funding source with the establishment of the Transportation Trust Fund Sub-Account for Capital Reserves, funded from the excess of constitutionally dedicated Petroleum Products Gross Receipts tax revenue not needed to satisfy current year debt service obligations. It is estimated that the Sub-Account for Capital Reserves will provide approximately $2.3 billion in total new "pay-as-you-go" funding through fiscal year 2024 in support of statewide transportation capital projects.

A. The TTF reauthorization bill enacted in 2016 provided for an additional $12 billion in bonding capacity over the FY 2017 – FY 2024 period. Unlike the previous reauthorization bill initiated in FY 2012, the current program does not prescribe annual bonding limits by FY. Provision of an overall cap covering the entire reauthorization period provides greater flexibility in determining the timing and size of prospective bond issuances. Under the current authorization the Authority issued $750 million in new state contract debt in December 2022 (FY23) and $750 million in January 2022 (FY22), respectively.

Under the current authorization, the Authority previously issued $1.5 billion in new state contract debt in December 2020, $1.0 billion in October 2019, and $750 million in January 2019. Per the TTF reauthorization, any bond premiums generated with respect to these Transportation Program bonds, as well as any bond premiums generated from the refunding or remarketing of existing Transportation Program bonds, are to be counted against the bond cap. As of June 30, 2023 the Authority had available bonding capacity of $6.6 billion. (see Bonds for more information).